BOSTON ( TheStreet) -- Hot gadget maker Apple ( AAPL) and filtration company Polycore ( PPO) are favorite stocks of market strategist and technical analyst Gene Peroni Jr., who favors growth over value even as the economy is stuck in a rut.Peroni, whose father pioneered the "Peroni Method" of selecting stocks using a technical perspective over 50 years ago, says he follows charts and valuation, as well as money flows and relative strength, to find stocks where there is sustainability of a trend.
Carbo Ceramics ( CRR) Company Profile: Carbo Ceramics is the largest supplier of ceramic proppant for fracturing oil and gas wells. The company is also a provider of the world's most popular fracture simulation software. Share Price: $152.38 (Sept. 20) Peroni's Take: Carbo Ceramics, like Polypore, has increased earnings and revenue over the last year. And also like Polypore, Carbo shares have a forward P/E above 20. "It's a higher-priced stock, so it is a bit volatile. But we do like this industry," Peroni says. "We hold Carbo in several different portfolios." From a technical perspective, Peroni says Carbo has a similar pattern to Polypore in that it was making a string of new 52-week highs. "In August it declined quite sharply but has now recovered," Peroni says. Shares of Carbo are up 47% this year and yet are still below the all-time high of $183.34 set in July. "It is trading at its 50-day moving average level, which is another good sign like Polypore," Peroni adds.
Herbalife ( HLF) Company Profile: Herbalife is a network marketing company that sells nutrition and weight-management personal care products. Share Price: $57.91 (Sept. 20) Peroni's Take: Even in a bad economy, consumers want their nutritional supplements. Herbalife shares have soared 70% this year to record highs, and Peroni says the stock has a very strong longer-term trend. "It's a reasonable price-to-earnings ratio," Peroni says. Herbalife has a forward P/E of 16, a slight premium to the broader market. That valuation may be justified considering earnings and revenue were up sharply in the second quarter both sequentially and year over year. "The P/E ratio may look a little high, but there is good growth potential," Peroni says. "There a number of stocks in this particular consumer sector -- personal care -- that are very attractive."